(NASDAQ: ELPAQ) announced today that a jury in a U.S. District Court
in Midland has found the company and two former officers not guilty of
charges stemming from the sale of annuities by First Service Life
Insurance Company between 1984 and 1987.

The company was one of 17 corporations and 11 individuals originally indicted by an El Paso County grand jury in June 1991 on felony charges involving an alleged conspiracy to commit theft in connection with the sale of annuities by First Service Life Insurance Company. The defendants, which included former El Paso Electric officers Evern Wall and Billye Bostic, were later reduced to 11 corporations and 7 individuals. Wall retired from El Paso Electric in June 1989. Bostic last held office with El Paso Electric in 1987 and retired from one of its former subsidiaries in March 1989.
In reaching its not guilty verdict and vindicating every defendant, the jury, which was called upon to review over 10,000 pages of documents, took only six hours to deliberate. The trial lasted two weeks and was presided over by U.S. District Judge Lucius D. Bunton, III.
"The company, all of its former officers and other parties, have been completely and finally exonerated of these groundless charges by the jury's verdict," said David H. Wiggs Jr., chief executive officer, president and chairman of the board of El Paso Electric. "We maintained all along that the company and every other party acted legally and responsibly in its transactions with First Service Life, and that the charges made against the company and the other parties were totally without merit."
El Paso Electric Company, which filed for protection under Chapter 11 of the Federal Bankruptcy Code in Jan. 8, 1992 was an electric utility serving approximately 250,000 customers in El Paso, and an area of the Rio Grande Valley in West Texas and Southern New Mexico. The company currently owns or leases a 15.8 percent interest in each of the three 1,270-megawatt nuclear units at the Palo Verde Nuclear Generating Station located near Phoenix, Ariz.
-0- 7/24/92
/CONTACT: Alan Lee Bunnell of EPE, 915-543-5823/
(ELPAQ) CO: El Paso Electric ST: Texas IN: UTI SU:

SH -- NY028 -- 2988 07/24/92 11:17 EDT

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